FM P Chidambaram proposed continuing non-tax benefits to these units for three years even after they graduate higher.BENGALURU: Innoviti Payment Solutions has launched smelending. com, a lending marketplace to propel its credit distribution business piloted last year.

The marketplace connects small business buyers, large manufacturers or sellers to these buyers and lenders who are interested in extending credit to such buyers, to disburse loans from as low as Rs 5,000 to Rs 2 lakh at interest rates ranging from 16 per cent to 18 per cent.

The Bengaluru-based company has been developing this concept with two leading wholesalers and their buyers for a year and has disbursed loans to 24,000 buyers that have availed themselves of credit for 14-45 days through this platform.

It distributes 400 loans daily on average across 20 cities, amounting to a loan value of Rs 400 crore annually, during the pilot. Innoviti takes a percentage of every transaction depending on the industry from both the lender and seller, as part of its revenue model for this business vertical.

"In conventional trade or B2B (business-to-business), a buyer expects supplier to give credit (for 30 days typically). This is a natural trade practice. The seller gives out credit from his books and runs into risk and cost of collection. Essentially this marketplace frees up sellers from the need to provide credit," said Rajeev Agrawal, CEO, Innoviti.

The company has tied up with one large non-banking financial corporation (NBFC) as a lender and plans to increase this number to up to six lenders in the next phase of its growth which will be a combination of public and private banks as well as NBFCs.

Innoviti aims to make small ticket loans profitable for lenders through its model. As per the annual report for 2014-15 of the ministry of MSME (micro, small and medium enterprises), there are over 40 million SMEs contributing to about 30 per cent of India’s gross domestic product.